You’re currently drowning in debt and you don’t know how you’re ever going to pay it off. That’s why you’re considering filing for bankruptcy. The only problem is you’re worried about what it’s going to do to your credit. Will you ever be able to get another credit card? How about a personal loan, a car loan, or a mortgage?
Here’s the real scoop on what will happen to your credit after you file for bankruptcy.
How Bankruptcy Affects Your Credit
When you file for bankruptcy, it’s true that your credit score will initially go down. If you have been able to stay current on your bills, then you could be eligible to file for Chapter 13 bankruptcy. This involves reorganizing your finances and making a payment plan to repay some debt before you receive a bankruptcy discharge. A Chapter 13 bankruptcy will stay on your credit report for seven years, which isn’t that long in the grand scheme of things.
Increasing Your Credit Score After Bankruptcy
There are a number of reasons why people go into debt. Sometimes they open credit cards when they are young and don’t know how to properly use them, or they need to put expensive medical bills or other emergency payments on cards. Once you’ve learned your lesson about credit and debt, you’re likely to do a much better job managing your debt in the future. You can spend less than you make, pay all your debts on time, and avoid high-interest loans and credit cards, which will bump up your score over time. Therefore, filing for bankruptcy can end up being a very positive thing in the long run.
Contacting Richard P. Arthur for Bankruptcy Help
Richard P. Arthur, Attorney at Law, can help you file for bankruptcy. You can call 937-254-3738 for a consultation. He has nearly three decades of experience assisting clients in Dayton and Trotwood, as well as Montgomery, Greene, Miami, Clark, and Warren counties.